OAKLAND — Berta Berrayo is trying to hang on to the quaint East Oakland home that represents her American dream.

Sitting on her front porch Saturday, decorated with a U.S. flag and a statue of the Virgin Mary, Berrayo shared with Rep. Barbara Lee, D-Oakland, and a crowd of others her plight as a working mother and recent foreclosure victim.

"We have to find a solution to the foreclosure crisis,'' said Berrayo, who was a first-time home buyer when she made the purchase four years ago. "The banks don't want to negotiate with us or our community.''

Lee was in her district this weekend to take a bus foreclosure tour around Oakland, which is among the 20 U.S. cities with the most number of houses in foreclosure.

She was joined by City Council members Desley Brooks, Eastmont-Seminary, and Larry Reid, Elmhurst-East Oakland. Their districts have about 400 bank-owned homes and are at the epicenter of the foreclosure crisis.

The tour was organized by the Association of Community Organizations for Reform Now, or ACORN, which advocates for low- and moderate-income families. Representatives from the Urban Strategies Council and the Department of Housing and Urban Development also participated in the event. Junious Williams, CEO of the Urban Strategies Council, said the foreclosure crisis is the "tipping point" for neighborhoods that already have a lot of problems.

"The American dream is turning into a nightmare, and unfortunately the federal government hasn't done enough to help,'' Lee said. "The impact extends beyond the personal tragedies of families "...there's massive suffering in our country and our communities.''

California led the nation with 68,666 foreclosure filings in June.

Lee is supporting a package of legislation to help those who have been affected by the subprime mortgage crisis.

"The numbers are shameful, and we need to send a loud message to the White House that the president must sign a bill that will be a long-term fix," she said.

Lee hopes to leverage $5.4 million of federal neighborhood revitalization funding to her district to rehabilitate and resell vacant properties.

This year, about 3,800 subprime loans will reset in Alameda County, according to data collected by ACORN.

On Tuesday, Gov. Arnold Schwarzenegger signed SB1137 into law.

It requires mortgage lenders to talk with homeowners before foreclosing, gives tenants more time to vacate foreclosed properties and requires owners to maintain foreclosed properties to prevent neighborhood blight.

"Some people are living alone on a block of foreclosed homes,'' said Brooks. "There is a diminution in the quality of life, and we need to change that.''

Contact Kamika Dunlap at kdunlap@bayareanewsgroup.com or 510-208-6448.